SDG&E and Port of San Diego Partner on Energy Management Plan to Promote Economic Competitiveness and Meet Climate Action Goals

To promote the region’s economic competitiveness, reduce greenhouse gas emissions, and improve air quality, the Port of San Diego and San Diego Gas & Electric (SDG&E) have jointly developed an innovative blueprint to “green” port and port tenant operations, such as cruise ships, hotels, restaurants, and maritime industries.

The Energy Management Plan created by the Port and SDG&E is the first of its kind proposed in California under Assembly Bill 628. The law signed in 2013 recognizes that the supply and cost of energy are an important factor in the economic competitiveness of ports and port businesses.

SDG&E filed an application with the California Public Utilities Commission (CPUC) on Sept. 13 for approval to implement key components of the Energy Management Plan, which was approved unanimously by the Port Commission in August. CPUC approval is expected to take 12-18 months.

Under the plan, SDG&E would work hand in hand with the Port and its tenants to implement a variety of energy-efficiency and advanced-technology initiatives, including a mobile battery storage unit, to achieve long-term environmental and economic benefits through resource conservation and pollution prevention.

In addition, the Port would be provided with an economically competitive shore power rate for cruise ships to plug into the grid when they are docked at the North Embarcadero. When cruise ships run on electricity instead of diesel engines, there is less air pollution. Forty-three percent of SDG&E’s energy comes from solar, wind and other renewable sources – making our region’s energy among the cleanest in America.

Reduced emissions will help the Port meet the greenhouse gas (GHG) reduction goals in its Climate Action Plan (CAP). The CAP calls for reducing GHG emissions 10 percent by 2020, relative to a 2006 baseline.

“The Port of San Diego has long been a champion of environmental initiatives to ensure that San Diego Bay remains a vibrant resource and contributes to our remarkable way of life,” said Port of San Diego Chairman Robert “Dukie” Valderrama. “The Energy Management Plan will support our efforts to implement energy-efficient technology, which benefits the community at large, while enhancing the competitiveness of our cruise destination – making it a win for all concerned.”

“Partnering with the Port and its tenants on energy efficiency and carbon emission reduction is important to our region’s efforts to clean the air we breathe and build healthier communities,” said Scott Crider, vice president of customer services for SDG&E. “And this partnership aligns perfectly with our commitment to build the cleanest, safest, and most reliable energy company in America for our customers and communities.”

The Energy Management Plan covers five years, and the vision is for it to evolve with business and technology changes. The following components of the plan require CPUC approval:

An economically competitive shore power rate to attract and retain cruise ships: With increasing frequency, cruise ships are required by state greenhouse gas regulations to turn off their diesel engines and run on electricity instead. Under the implementation of a new rate structure, the cost of plugging in can increase exponentially for cruise ships, making the region less attractive for cruise ships. According to an economic impact analysis commissioned by the Port, 77 cruise ships came to San Diego in 2015, generating $82 million in direct and indirect economic impact, which in turn generated the equivalent of about 650 full-time jobs. To avoid disruptions in business from the new rate structure, the Public Utilities Commission is allowing Port of San Diego cruise ships to continue paying their current rate on an interim basis until the Energy Management Plan is approved. The shore power rate, pending approval by the CPUC, would be structured differently and remain in place for five years.

Enhanced Partnership Program: SDG&E and the Port will dedicate staff and funding to oversee the implementation of energy initiatives, track results, and engage with stakeholders.

Energy-Efficiency Measures: Through a competitive process, SDG&E will seek experienced companies to develop energy-efficiency measures for the Port and its tenants that are above and beyond what is available today.

The Energy Management Plan also calls for exploring or implementing advanced technologies under other approved legislative measures and CPUC applications: 1) mobile energy storage for the cruise ship terminal and other uses, such as community events; 2) a microgrid analysis to determine which areas of the Port may be suitable for deploying the technology; 3) installation of charging equipment to support electric forklifts and other freight-handling equipment.

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